Saturday, August 18, 2007

Stockcharts.com Weekly review

It was another volatile week for the markets with good potential for a bottom based on Thursday's capitulation. How did the Stockcharter's see it?

Dr. Joe Reed
opens with the week summary:


Joe has marked a trigger 'buy' in Full stochastics for the Dow:


The S&P has also tested at support level:


With the S&P Percent of Stocks above the 50-day MA having reached extreme oversold levels:


Joe has a good chart showing the false breakout in the Euro (maybe my dollars won't be as worthless now that I need to work in Euros!):


With Gold and the Dollar poised to move:


Robert New is looking to Long Term Support for the Nasdaq:


Robert's 10-year Treasury Note Yield chart is always a good one to check:


But his best chart looks to be his Russell 2000 chart - a 'buy' signal in play:


Mitchell Meana has marked a rising channel for the Dow. Presumably the fifth wave is complete:


Richard Lehman has his usual weekly summary:

8/16 -- Whew! Nice reversal, and right off a number of short term channel support lines. But lots of damage to long term charts, so this may or may not be a new uptrend. Almost nothing has broken to the upside yet.

8/15 -- The damage has now spilled into the longer term charts as several indices broke multi-month channel support lines. Some short terms may be setting up for a bounce soon (like XAU and SPX) but others have already broken so that is not a high confidence play. Also, the long terms now look like they are either breaking support of accelerating to steeper downslopes.

8/14 -pm- One advantage of watching 5-minute charts is they can tell you very early on that a move is breaking. This morning was a case in point. The zigzags are now lasting barely a few days before turning. The larger picture is clearly more important now and is heading lower. First support lines have been reached in the Naz and the Dow but that's not really enough to call a bottom here yet. I think larger downchannels will become more well defined as we head lower.

8/14 -am- Opening weakness is already taking the indices out of recent short term uplegs. It may be too early to get long again.

8/13 -- The short term charts rolled over today, hopefully in preparation for a low point that will firm up the lower channel lines of this new upmove. The upmoves are narrow, however, and are not particularly encouraging on the upside. I still see these recent zigzags on the short term charts as legs of a larger move, and that larger move being down.

Asher Pinto has a good observation on the Russell 2000 - will this gap close?


His S&P chart neatly shows key support and resistance:


With volatility correcting off its highs:


Steven Swink goes against the crowd and sees value in gold and silver stocks:


I will finish with Maurice Walker's weekly review:
8/16 Commentary: The market managed a turnaround today as the Dow had dropped approximately 340 points. The indices violated the lower boundary of their falling price channels. Trend channels can expand if the original channel is to tightly compacted. Channels can also have a double set of basic trendlines above the channel, and another double set below the channel. I am not saying that is the case here, but it is a possibility. Double trendlines usually materialize over several months before becoming distinctly recognizable once two sets of parallel lines have formed.

The recovery has formed bullish falling wedges on the 60 minute charts(see 60 minute charts at the bottom of this page). It appears that oscillators are now reset.

The Dow's unbalanced Complex H & S pattern on the daily chart, measures approximately 860 points with a target of 12,300. With the recent sell of it has successfully moved over 3 % lower, confirming the pattern. The Dow broke below it's 200 day MA today, but losses were recovered as it managed to close just above it.

The SP 500 tagged major support today near 1370 as it has retraced all the gains made since our march lows with a 100 percent Fibonacci retracement.

The weekly charts continue to have RSI readings below the value of 50, which should leave us concerned. The long term trendlines have been violated on the indices which makes me think that we may backtest them on our next recovery. With the breaking of any Intermediate trendline comes the consequences of either a corrective pattern or retraces. The SP 500 appears to be forming a reversal pattern. We now have a left shoulder and a head formation on the weekly chart. If a right shoulder eventually forms it may reach near the 1461 area, just as the left shoulder did. I continue to watch the SP 500 daily chart for a 50/200 day MA bearish crossover, which may occur soon as the 50 day MA continues to increase downward velocity. Please vote.


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